Tiny Drops in an Enormous Bucket

In the comment thread to my previous post on third-world poverty, John T. Kennedy questions my wisdom in encouraging consumers to enthusiastically purchase products made with sweatshop labor as a means to help these workers increase their standard of living.

I don't understand Kennedy's pessimism. It is true that the economic effect on sweatshop worker's wages from one American consumer's purchases are negligible. But, then, so are the tariffs the U.S. government places on one American consumer's sugar purchases. Millions upon millions of negligible effects add up to quite a wallop, to the point where the additional cost American consumers must pay for sugar far outweighs any benefit enjoyed by the American sugar industry. So too, if, instead of avoiding products made in sweatshops out of some misguided sense of guilt, American consumers recognize that their individual, imperceptible, negligible consumption choices add up to a large benefit for poor workers in third world countries, large groups of people may choose to change their consumption choices in ways that are not negligible, but extraordinarily significant for sweatshop workers.

The feeling one gets when "doing the right thing" is not an irrational reason for doing something, nor is it irrational to engage in even small acts of charity. And it is certainly not irrational for bloggers, journalists, and other people whose writings may affect public opinion to publicize this kind of message to large numbers of people in order to change the "meta-context" of society.

Surely, Kennedy did not come to understand the benefits and morality of capitalism, free trade, and non-aggressive interaction all by his lonesome. Surely, the opinions Kennedy currently holds were influenced by people like Lysander Spooner, David Friedman, Murray Rothbard, and others. And, just as surely, despite their brilliance, the above mentioned writers did not come to understand these same things all by themselves either. Even if one person's actions and opinions do not directly affect society as a whole, ideas (I would say memes if I didn't try as hard as possible to avoid that hackneyed term) can spread to other opinion makers, which in turn spread to others, and so on.

My mother emailed a copy of an article I wrote for TCS to my aunt who lives in Israel. My aunt, who is American by birth but has lived in Israel for all of her adult life, wrote an email back to me, expressing admiration for my writing, but questioning my opposition to government intervention into the economy. Her main concern was, coincidentally, the harm she thought resulted from sweatshop labor.

Here are her exact words:

Dearest Micha,

I am so impressed by your writing. This article was excellent, well thought out, interesting and deep. It's great that you start off with personal thought-provoking questions and then bring a real-life example to use as a metaphor for drier topics such as economics.

One question: I really don't understand anything about economics and what your point is exactly, but I seem to understand that you are against government intervention in the economy? My problem is that if the only deciding factor is profit/loss or pleasure/pain, there are many terrible things that occur. For example, there is a world-wide scourge of slavery today, including child-slavery, where kids are sold as slaves by their starving parents and work their entire lives in horrible conditions with no hope for freedom. This is all so that we rich amaericans can buy our clothes at rock bottom dicounts or buy our appliances at 1/2 price. Do we really know what is going on in the countries we buy goods from?

So I think we really need moral intervention. When human beings have only money as their god, it's a scary thing.

Hope I got the grasp of your article.

Love,

Aunt Sho

My aunt does not have a television in her house and does not read American newspapers. I have no idea where she picked up the idea that government intervention or even voluntary boycotts are necessary to help address third-world poverty and child labor, but this is an indication of how far ideas can spread, even--some would say especially--when these ideas are based on bad economics. It is for people like my aunt who mean well but "really don't understand anything about economics" that I continue to write, to help spread ideas to others just as others have spread ideas to me.

If I could press a button right now and make this world a freer, wealthier, more peaceful place, I would. If I could invent a new technology or start a new business to achieve the same effect, I would. But until that day comes, the best path I see to a world more respectful of liberty is the changing of hearts and minds through peaceful persuasion and economic education. We have a long way to go before we reach that goal.

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Replace "purchase products

Replace "purchase products made with sweatshop labor" with "vote for Libertarian candidates for public office" and you've got an interesting argument here for encouraging people to vote Libertarian.

Micha: "The feeling one gets

Micha: "The feeling one gets when ?doing the right thing? is not an irrational reason for doing something, nor is it irrational to engage in even small acts of charity."

It is certainly not a rational reason, it is a feeling. I'm not going to argue one way or another right now whether or not buying the products of "sweatshops" is beneficial to the workers in the long or short term, but, given your goal (help them) it is more important to determine (using your reasoning capacity) whether your actions actually help or harm them than whether your actions make you feel like you're helping them.

Many people support Social Security because they feel like it is helping you save for your retirement. Do you want that kind of help?

Andy, I think we are using

Andy,

I think we are using two different definitions of "rational." You are using it to mean "pure reason or pure logic, but not emotion." I am using it in the economic sense as "acting to satisfy one's subjectively held values." Values themselves are nothing more than feelings; if it is rational to purchase a candy bar because it makes you happy, then it is certainly rational to give to charity if it makes you happy.

Micha, It all depends on

Micha,

It all depends on what your goal is. Is your root reason for giving to charity (or buying 500 pairs of Nike's)

A) It makes you feel good to give to charity.
B) It makes you feel good to help people.

Both goals can be rationally pursued, but (B) takes more work, and the two may not be compatible, depending on the charity (or like of "sweatshop" products) you choose.

Micha, I would love to see

Micha,

I would love to see your reply to your Aunt! :)

Michi, Here is part of what

Michi,

Here is part of what I wrote back:

    I am indeed against government intervention into the economy. Although child labor is horrible, the available alternatives are even
    worse. As bad as children working in a factory for long hours under terrible conditions sounds to us, the alternative is often child prostitution, rummaging through garbage, or severe malnutrition. American and European companies who outsource their labor to factories in third-world countries pay more than the local wage, which is how they are able to attract workers from other opportunities. As more and more companies outsource their labor to these countries. competition for labor increases, which raises the wage level. When a country's level of wealth is high enough, parents are able to support their families without having to rely on their children's labor as well. So don't feel guilty when you purchase clothes and appliances made in third-world countries by children working in factories; know that what you are doing is the best way to help those children.

    Here is an interesting article on the issue from the NY Times:
    http://www.nytimes.com/library/magazine/home/20000924mag-sweatshops.html

"...if it is rational to

"...if it is rational to purchase a candy bar because it makes you happy, then it is certainly rational to give to charity if it makes you happy.

In the same sense that it's rational to vote for wealth redistribution if it makes you feel happy.

"Replace ?purchase products

"Replace ?purchase products made with sweatshop labor? with ?vote for Libertarian candidates for public office? and you?ve got an interesting argument here for encouraging people to vote Libertarian."

Or Republican. Or Democrat.

You're right that the argument is the same, but it's a lousy argument.

Collective action!

Collective action! Gasp!

Statist!